Loans will make it easier for young people with business ideas to realise their ambition, says prime minister
Young entrepreneurs will be able to obtain government loans to help them launch a business under a new StartUp scheme to be launched by David Cameron on Monday.
Over the next three years, ministers will put £82m into the scheme, which will fund loans worth on average £2,500 to people aged 18 to 24 who can show that they have a robust business plan.
The launch coincides with the publication of a report from Lord Young, Cameron’s enterprise adviser, saying that there would be 900,000 more businesses in Britain if it had the same culture of entrepreneurship as the US.
Cameron said the StartUp scheme, which will be administered by a range of organisations including the Prince’s Trust, would offer a “fantastic opportunity” to young people with a business idea.
As well as the loan, which can last up to five years, with an interest rate of RPI plus 3%, participants will also receive help in developing a business plan and training.
The entrepreneur James Caan will chair a body that will oversee the allocation of the loans, which will start being paid on a pilot basis this year. Ministers believe more than 30,000 young people could benefit by 2014-15. “I want this to be the year where people can think: yes, I can do it, that we can get as many viable businesses as possible off the ground, that people can have a go,” Cameron said.
Young’s report says opportunities for small businesses are good because the internet has made it easier for individuals to launch their own companies. Statistics showing a record 450,000 startups in 2011 appear to bear this out.
“But we cannot be complacent,” Young said. “Now more than ever we have got to get behind our small businesses and encourage even more people to seize the opportunities and support that there is.”